For further information:
George Mallay
General Manager, Sarnia-Lambton Economic Partnership
519-332-1820
mallay@www.sarnialambton.on.ca
Marc Mageau, Vice President
Sarnia Refinery, Suncor Energy Products Inc.
519-383-3601
mmageau@suncor.com
Raymond Curran
Chair, Board of Directors, Curran Contractors Ltd.
Chair, Labor Relations Council, Sarnia Construction Association
519-332-3610
guyc@currancontractors.com
Sarnia-Lambton still producing for refinery and petrochemical sector
Go to our Media Centre to hear associated audio clips from Marc Mageau and Ray Curran.
City of Sarnia/Lambton County, ON, CDA – Mark Mageau shows the confidence of a person who has looked into the future and is excited about what is in store.
The vice president of Suncor Energy Products’ refinery in Sarnia-Lambton has been taking part in a series of orientation and planning meetings, where Canada’s largest energy company is taking shape. The Sarnia facility is one of four regional refineries owned by the new corporation, which was officially established in August, following the merger of Suncor Energy Inc. and Petro-Canada.
“It is an exciting time for us in the new Suncor,” Mageau said. “We feel we are in the process of building Canada’s premier energy company, based in Canada with national and international assets.”
You don’t have to be a clairvoyant to see that Suncor’s Sarnia refinery is likely to retain a valued position within the new organization. The facility is situated in Canada’s largest market, with demand for its fuels continuing to exceed capacity. But, as Mageau points out, the site continues to earn its credits, offering infrastructure and location-related advantages.
Showing its confidence in the refinery’s capabilities, Suncor made a billion-dollar investment in site process improvements, which were completed in 2007. The construction of a distillate hydrotreater ensured that Sarnia refinery products meet the federal government’s low-sulphur diesel fuel regulations.
The compliance-driven initiative also led to a landmark service agreement, which allowed a neighboring Shell Canada Limited refinery to share the use of the diesel desulphurization unit on the Suncor site.
The multi-year Suncor Sarnia project, called Genesis, included equipment upgrades, giving the site greater access to more oil sands synthetic crude. “The (Alberta) oil sands is now a key piece of the world’s petroleum landscape,” noted Mageau. “Consuming our own production crude is the best way for us to leverage our business assets and make money across our entire supply chain.”
Project Genesis was the largest single project undertaken at the Sarnia refinery since the start up of the site in 1953. At its peak, the two-year construction project involved a workforce of 1,000 people.
Size aside, the Genesis Project was one in a long line of industrial developments that have showcased the versatility of Sarnia-Lambton’s fabricators, contractors and trades people, as they meet the needs of the area’s petrochemical and refinery plants, said Ray Curran, chairperson of the Sarnia Construction Association’s labor relations council. He is also a senior executive with Curran Construction, a family business that has worked on virtually every plant site in the area over its 61-year history.
Through his company’s business and his work on behalf of the local construction association, Curran has a sound working knowledge of Sarnia-Lambton’s workforce and its capabilities. The construction association works closely with some 20 local trade organizations, which have ties to a skilled labor pool of approximately 5,000 workers.
“We are an industrial community,” emphasized Curran. “Sarnia is the second biggest source of pipefitters in Ontario, next to Toronto. That’s more than Hamilton, Windsor and London. To have a workforce of that size in Lambton County, with a population of 128,000, really says something about how important the petrochemical and refinery industry is to us.”
The Sarnia Construction Association and its industrial trade group affiliates continue to work closely with local refinery and petrochemical plants to maintain an environment that supports and encourages further development. In a unique forum, representatives from local industry, labor and construction contractors meet regularly to plan and coordinate the resources required for future projects. “It’s an approach that doesn’t exist to this extent anywhere else, where the three groups work together to maintain the productivity and the safety of the workforce,” Curran noted.
Suncor’s Genesis Project benefitted significantly from the workforce planning and preparations of the local tripartite. Local building and trade associations were able to help the company to meet and maintain its substantial construction workforce. As the project progressed, the local pool of skilled laborers was gradually expanded to include workers from across Ontario, other Canadian provinces and the United States.
While the Suncor project was a significant undertaking, Sarnia-Lambton’s labor groups and professional services consultancies are accustomed to scaling their resources up and down, to meet the ongoing demands of area refineries and petrochemical facilities.
A number of the industry’s best-known engineering consulting firms maintain Sarnia branch offices that respond to a wide range of local technical requirements.
Montreal-headquartered SNC-Lavalin has a staff of more than 250 people at its Sarnia location. “Our skills have been developed and are solely dedicated to the chemicals and petroleum industry,” said Robert Stewart, SNC-Lavalin vice president and general manager.
Stewart characterized the Sarnia-Lambton industrial community as comprising of very sophisticated clients. “Overall, they’ve executed an extensive list of projects and follow a highly disciplined approach to project development and management.”
Andrew Stoesser, vice president, Strategic Development and Account Management, agreed adding that the SNC-Lavalin Sarnia team has been able to draw on the firm’s worldwide experiences to effectively respond to the wide-ranging needs of its local clients. “There are a number of complementary skills and knowledge from across our global corporation that we’re able to offer from our Sarnia offices, such as process capabilities and worldwide procurement.”
At the same time, its extensive work at area plant sites has gained the firm’s Sarnia office a unique standing within SNC-Lavalin’s global organization. The group is recognized as a centre of excellence for managing and implementing revamp-type projects. Revamp projects include modifications, improvements and expansions of existing facilities, often requiring the innovative application of proven technology.
“It’s not a matter of offering a fixed, one-solution package,” explained Stewart. “By working closely with our clients, we gain a clear understanding of their needs. We can then make the necessary contributions to help them to get to where they want their business to go.”
Clearly, the corporations that operate refineries and petrochemical plants in Sarnia-Lambton want their business to go places.
According to Stoesser, today’s cost-sensitive projects must typically meet multiple objectives, combining productivity, operational and environmental interests within a single undertaking. Complementary project objectives can involve expanding production capacity, improving safety controls, reducing energy consumption and diminishing environmental effects.
Major process improvements recently completed a short distance from Suncor’s Sarnia refinery at the largest of NOVA Chemicals (Canada) Inc.’s four area production facilities are an example of how companies are stretching their investment dollars. The $300-million technology upgrade improved the competitiveness of the world-scale ethylene facility, by increasing its energy efficiency and expanding its ability to access a wider range of economical feedstocks.
The NOVA Chemicals investment was based on a long-term view of the industry, said Graeme Flint, vice president, Business Development, whose responsibilities include the company’s Sarnia-Lambton businesses. The plant upgrades are rewarding the company with an improved economic output, which is supported by ready market access.
“In our business, being a low-cost producer is extremely important,” explained Flint. “Sarnia gives us direct pipeline access to feedstocks from the west as well as the east, with over 60 percent of the North American market within a 24-hour drive.” Access by local production facilities to regional, continental and global markets is enhanced further by modern rail, road and waterway terminals.
Many local companies have extended the benefits of pipeline access by creating their own local links, which transfer feedstocks and steam directly to their sites from area producers. According to the Sarnia-Lambton Economic Partnership, area refineries and petrochemical plants produce or have ready access to more than a dozen hydrocarbon feedstocks and intermediates, in addition to steam.
“The connectivity between ourselves and the other plants in the area allows products to flow back and forth in a logical interchange of materials, so we can produce a variety of different products amongst us in a very cost-effective way,” observed Suncor’s Mageau.
In NOVA Chemical’s case, the pipeline interconnections offer significant, practical advantages, by physically and economically integrating its four local sites to form a single production unit.
“When you’re integrated,” said Flint of the company’s local operations, “you’re able to weather downturns in any of the segments with a higher degree of economic stability, because you’re bolstered by the performance of the other production facilities in the chain. Extending the chain by including pipeline links to our local customers, offers them comfort that we are a financially strong and reliable supplier of their raw materials.”
Flint believes that other companies could make similar economic gains, if they integrated new manufacturing facilities into Sarnia-Lambton’s existing chemical and refinery complex.
“This area offers considerable benefits to attract manufacturing companies that could take what we already produce locally and convert them into higher, added-value products and finished goods,” offered Flint. He suggested that local opportunities exist for a wide range of manufactured goods, including food packaging, household products, toys and auto parts.
The cooperative approach to business that has long been maintained by Sarnia-Lambton companies extends beyond the integration of feedstocks, to include a range of positive initiatives involving local governments and educational institutions. Through a variety of forums, progress is being made in such areas as worker training and education, environmental performance improvement and economic development, as well as mutual aid and emergency response.
Of the many cooperative undertakings, one of the most successful is Sarnia-Lambton’s industrial worker safety program.
According to recent work practice studies sponsored jointly by Ontario’s Workplace Safety & Insurance Board and the Construction Safety Association, Sarnia-Lambton’s safety performance, in terms of lost-time injuries, is 25 times better than the Ontario average.
“That’s the best safety record in all of Canada,” noted Curran of the construction association.
The studies have pinpointed the presence of stringent training standards and self-enforced workplace procedures and practices as the key ingredients of Sarnia-Lambton’s safety performance. The mandatory training, which is conducted at a cooperatively run education center (www.sarniasafety.com), and standardized workplace practices have been embraced by the vast majority of companies in the community, including refinery and petrochemical plants, as well as their contractors and suppliers.
The search for economic growth opportunities is another area where local private and public sector partners share their knowledge, resources and contacts. The rewards for their efforts have come in a variety of forms, including the creation of a Center of Excellence for Commercialization and Research.
The center is situated at the home of another community accomplishment, the University of Western Ontario Research Park’s Sarnia-Lambton Campus. The Canadian and Ontario government-funded enterprise facilitates the formation of private and public sector partnerships to connect promising research with industrial knowledge and strategic investment interests.
The level of cooperation pursued in Sarnia-Lambton might also help the community to gain an early exit from the grips of the current recessionary economy.
In August, the value of new construction starts in Sarnia climbed above $14 million, a level that is 125 percent higher than the same period a year ago, just prior to the global economic downturn. Indications are that September’s new construction starts, which include upgrades by a local refinery, will maintain the positive trend, possibly exceeding the city’s monthly average for the past 10 years.
“This is a community that gets the oil and chemical business and understands the possibilities,” stated Suncor’s Mageau matter-of-factly. “Going back to the discovery of oil in the mid-1800s and then on to the production of rubber for the war effort in the early 1940s, people have traditionally looked to this area, because it has the industry in its bones. You can see it in the quality of public debate around the risks and hazards of the industry, as well as how to mitigate them and how to prosper in this business. And we also have the generations of people who have been the operators, fabricators, engineers and commercial business managers directly connected with its operation.”
“You know if you’re going to build a project here in Sarnia-Lambton, it can be designed properly here, equipment can be fabricated here and it can be built and run safely and effectively here. You can’t say that about too many other communities.”
Sarnia-Lambton is growing a promising and sustainable, green future from its historic industrial roots and abundant natural features. Situated along the famous blue waters of Lake Huron and the St. Clair River, Sarnia-Lambton’s distinctive combination of modern city amenities, small town charm, quaint country corners, sandy beaches and recreational attractions is home to an increasing number of people and businesses. Visit www.slep.wpengine.com to see why the community is well positioned for “powering a sustainable world (TM).”
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